Investing.com – Oil prices continued to rise on Tuesday in Asia, but gains were capped by concerns of intensifying trade war between China and the U.S.
U.S. were up 0.5% to $63.51. International gained 0.4% to $72.21.
Oil prices received some continued support from news that OPEC and its allies will extend production cuts beyond June.
Khalid Al-falih, the Saudi energy minister, indicated over the weekend that the kingdom will continue cutting output through the year-end at levels above compliance agreed by OPEC+. He also expressed hope that his other colleagues in the alliance would do the same.
Oil prices rose on Monday following his comments, but came off session highs after Minister of Energy of Russia Alexander Novak told Bloomberg in an interview that OPEC+ may need “to tweak” the current production deal when it meets next month.
One option on the table is “removing the over-compliance” with current targets, Novak said, a move that would effectively ease output cuts in the second half of the year.
Oil was also pulled down by concerns that a prolonged Sino-U.S. trade war could lead to a global economic slowdown.
Trade tension intensified after news of Google (NASDAQ:) suspending business activity with China’s top telecom company Huawei Technologies.
Earlier in the day, Bloomberg reported that companies including Intel (NASDAQ:), Qualcomm (NASDAQ:) and Broadcom (NASDAQ:) also decided not to supply Huawei until further notice.
Overnight, the U.S. government announced decision to temporarily ease some trade restrictions imposed on Huawei, allowing it to purchase U.S.-made goods for at least 90 days.
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